Chapter 5
Legal Affairs
The EEA legal world 2011 was another busy year of litigation for the EFTA Sur veillance Authority. Once more, it participated in all cases before the EFTA Court, either as a party or by systematic ally intervening in the preliminary reference proceedings originating from national courts. Furthermore, the Author ity continued to take part in a select number of cases before the European Union courts that have a particular impact on EEA law. In 2011, a total of 19 new cases were brought before the EFTA Court. That is a new record number of registered cases. Fourteen of the new cases concern the laws governing the EEA Internal Market. Four cases are actions for the annul ment of decisions adopted by the Authority in the field of state aid and one case relates to the Authority’s public access to documents rules. The majority of the Internal Market cases raise interest ing and substantive issues of EEA law. There is a trend towards an increase in the number of substantive cases before the EFTA Court and a diminution in the number which deal with the failure of States to implement EEA law. That trend shows that while the Authority is successful in bringing the States into compliance with EEA law in most instances, certain cases raise difficult issues which can only be resolved by the EFTA Court. Of particular note is Case E-16/11 on Iceland’s failure to ensure timely minimum compensation for savings made
in the British and Dutch Icesave branches of Landsbanki that were lost when that bank failed in October 2008. The Authority claims that Iceland has breached its obligations under the 1994 Deposit Guarantee Directive and discrim inated between savings made in Icelandic and other EEA branches of the failed Icelandic bank. Also in 2011, the EFTA Court handed down judgments in nine cases registered in 2010. Noteworthy is Case E-18/10, the Authority v Norway, in which the EFTA Court held for the first time that a State had failed to comply with a previous judgment of the Court in Case E-2/07 on sex discrimination concerning the calculation of wid owers’ pensions. The Court held in Case E-16/10 Philip Morris, an important ruling on the free movement of goods, that it is for Norway to show that its ban on any visual display of tobacco products in shops is both nec essary to protect public health and that this could not be achieved by less strict means. Finally, on competition law, the EFTA Court heard oral arguments by the parties and interveners in Posten Norge’s appeal against the Authority’s first decision to set a fine for an infringement of the EEA competition rules (Case E-14/10). Important issues on human rights were debated and in particular the consequences of the judg ment of 27 September 2011 of the European Court of Human Rights in A. Menarini Diagnostics S.R.L. v Italy. Case E-4/11 Arnulf Clauder Mr Clauder, a German pensioner, was granted a perma nent residence permit in Liechtenstein in 2002. In 2010, Mr Clauder applied for a family reunification permit for his
LEGAL AFFAIRS
new wife, which was rejected. The Liechtenstein author ities stated that as an economically inactive person, Mr Clauder could not prove that he had sufficient financial resources for himself and his wife without having recourse to social welfare benefits. Mr Clauder challenged this deci sion before the Liechtenstein Administrative Court which requested an Advisory Opinion from the EFTA Court.
connected with the fundamental right to the protection of family life.
In essence, it asked whether the Directive 2004/38 (the residence Directive) allows a pensioner who holds a right of permanent residence in a host State to claim the right to family reunification even if the family would be entitled to social welfare benefits.
This case concerns the terms and conditions of employ ment to be observed in the host State by employers who post workers there. Acting on a petition filed by the Nor wegian Confederation of Trade Unions, the Norwegian “Tariff Board” had adopted a regulation making parts of the Engineering Industry Agreement universally applic able within the maritime construction industry. STX Nor way Offshore and eight other companies then sought to have the regulation annulled.
The EFTA Surveillance Authority noted that once an EEA national has acquired the right of permanent resi dence, this right is not subject to conditions such as hav ing sufficient resources. EEA secondary legislation on free movement and residence cannot be interpreted restrictively and the residence Directive would lose its effectiveness if EEA nationals were not allowed to lead a normal family life in the host State. In addition, ESA sub mitted that the right to preserve family unity is closely
On 26 July 2011, the EFTA Court agreed with the Author ity’s arguments. Case E-2/11 STX Norway Offshore
The Norwegian Court asked the EFTA Court whether the Posting of Workers Directive permitted Norway to apply to workers posted to its territory the terms and condi tions of employment laid down in a universally applicable collective agreement: maximum working hours, additional
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New EFTA Court cases 2011 ase E-19/11 Vín Tríó ehf. v Íslenska ríkinu – Do the basic princiC ples of the free movement of goods prohibit a state monopoly on the sale of alcohol to refuse to sell beverages containing stimulants such as caffeine? Case E-18/11 Irish Bank Resolution Corporation Ltd. v Kaupþingi hf. – Clarification on a discrepancy in language regarding the provision of information to creditors. Case E-17/11 Aresbank S.A. v Landsbankanum hf & Fjármálaeftirlitinu og íslenska – Clarification of the scope of the definition of “deposit” within the context of deposit-guarantee schemes. Case E-16/11 EFTA Surveillance Authority v Iceland – (“Icesave”) – Failure to ensure timely payment of minimum compensation to depositors having lost access to their deposits. Case E-15/11 Arcade Drilling AS v Staten v/Skatt Vest – Exit taxation in Norway. Case E-14/11 DB Schenker v EFTA Surveillance Authority – Public access to documents collected by the Authority during an antitrust inspection at Norway Post’s premises. Case E-13/11 Granville Establishment v Volker Anhalt e.a. – Does non-discrimination of EEA nationals imply a right not to be sued in Liechtenstein on the basis of a private jurisdiction agreement that has not been publicly recorded? Case E-12/11 Asker Brygge AS v EFTA Surveillance Authority – Appeal against the Authority’s decision to order the recovery of state aid granted through both a real estate option and sale agreement in Norway. Case E-11/11 The Kingdom of Norway v EFTA Surveillance Authority – Appeal against the Authority’s decision that Hurtigruten ASA received unlawful state aid which must be recovered. Case E-10/11 Hurtigruten ASA v EFTA Surveillance Authority – identical as Case E-11/11. Case E-9/11 EFTA Surveillance Authority v The Kingdom of Norway – Ownership restrictions in stock exchanges and s ecurities depositories. Case E-8/11 EFTA Surveillance Authority v Iceland – Failure to create strategic noise maps and actions plans under Directive 2002/49/EC. Case E-7/11 Grund, elli- og hjúkrunarheimili v Lyfjastofnun – Restrictions to the importation of medicinal products into Iceland. Joined Cases E-17/10 & E-6/11 The Principality of Liechtenstein and VTM Fundmanagement v EFTA Surveillance Authority – Appeals against the Authority’s decision that favourable taxation of investment undertakings was unlawful state aid which must be recovered. Case E-5/11 EFTA Surveillance Authority v The Kingdom of Norway – Failure to incorporate two Regulations regarding the European Maritime Safety Agency (EMSA). Case E-4/11 Arnulf Clauder Case E-3/11 Pálmi Sigmarsson v Seðlabanki Íslands – Currency controls and capital movement restrictions in Iceland. Case E-2/11 STX Norway Offshore AS m.fl. v Staten v/ Tariffnemnda Case E-1/11 Norwegian Appeal Board for Health Personnel – appeal from Dr A – On conditions under which medical doctors trained in other EEA states may exceptionally be denied authorisation to practice in line with Directive 2005/36/EC.
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remuneration for work assignments requiring overnight stays away from home, and compensation for travel, board and lodging expenses. The EFTA Surveillance Authority argued, first, that the Directive does permit the State to regulate maximum working hours this way. Even if it is less clear what remu neration or compensation can be paid in case of work assignments requiring overnight stay, the Authority argued that the additional remuneration which is set at a flat rate could fall under the concept of “minimum rates of pay” as set out in the Directive. This means that it would be applicable to posted workers on an equal foot ing with other workers in the industry. In its judgment of 23 January 2012, the EFTA Court fol lowed the Authority on the issue of working hours, but took a stricter view on what remuneration Norway may impose in case of work assignments requiring overnight stay.
LEGAL AFFAIRS
Law firms 36% Public access to documents • The total number of access requests decreased from 125 in 2010 to 107 in 2011. • Only seven requests were denied, most of them concerning pending state aid investigations. • For the first time an Authority decision to deny access to documents was appealed to the EFTA Court. • Six requests led to only partial access to the document in question. • In four instances access was given to whole case files. • The requests came from the following groups:
Private persons 9.5% Governments 11.5%
Academics 8.5%
Companies 4%
Journalists 21% NGOs 9.5%
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Activities in the EU Courts
The oral hearing of the case before the ECJ is expected to take place in 2012.
During 2011, the Authority made written or oral submis sions in nine preliminary reference cases before the Euro pean Court of Justice (ECJ). The Authority applied to intervene for the first time in cases pending before the General Court in support of the European Commission in two cases on whether the EEA laws governing antitrust investigations comply with fundamental rights (Cases T-289/11 and T-290/11, Deutsche Bahn v Commission).
Case C-300/11 ZZ
Case C-202/11 LAS This case concerns a non-Belgian national, Mr Las, who was employed by a company operating in Antwerp, Bel gium. Mr Las got fired and that gave rise to the dispute. Mr Las claims that his contract of employment was null and void in the first place because it was drafted in English and not in Dutch. The Belgian legislation requires an undertak ing situated in the Flemish language region to draft all such documents in Dutch. The company, on the other hand, claims that this Belgian act is incompatible with EU law on the free movement of workers and should not be applied. The question put before the European Court of Justice is essentially whether Belgian legislation indeed infringes Art. 45 TFEU on free movement of workers. The EFTA Surveillance Authority’s answer in its interven tion is “yes”. The Belgian obligation is a restriction on free movement of workers which cannot be justified on pub lic interest grounds due to the fact that it is discriminatory and disproportionate. The Authority supported, therefore, that the national court should disapply the Belgian act.
Authority interventions before the EU Courts ase C-209/10 Post Danmark on Article 102 TFEU regarding selecC tive price rebates by a Danish dominant postal undertaking to clients of its competitors. Case C-476/10 projektart on Austrian restrictions for EFTA nationals to purchase a secondary residence. Case C-583/10 Nolan on a UK case on employers’ obligation to consult about collective redundancies pursuant to Directive 98/59/EC.; Case C-32/11 Allianz Hungária Biztosító on whether certain agreements between Hungarian motor insurers and car repairers that also broker motor insurance on hourly car repair charges have the object of restricting competition within the meaning of Article 101 TFEU. Case C-48/11 A on the interpretation of Articles 31 and 40 of the EEA Agreement as regards a Finnish case on the tax-neutrality of an exchange of shares between a company residing in Finland and a company residing in Norway.
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ZZ - an EU citizen of French and Algerian nationality - had been residing lawfully in the UK with his family when, in 2005, the UK authorities decided to exclude him from the UK on the grounds that his presence was not conducive to the pub lic good. ZZ appealed this decision. However, he was given very limited information about the public security grounds on which his exclusion was based. More detailed information was refused to both ZZ and his lawyers, on the basis that its disclo sure would be harmful to the public interest. Under Article 30(2) of Directive 2004/38 (the residence Directive), where an EEA citizen’s freedom of movement or residence is restricted on grounds of public security, that person should be informed, precisely and in full, of the grounds on which the decision is based, unless this would be contrary to the interests of State security. The national court has essentially asked whether the prin ciple of effective judicial protection is respected if only very limited information about expulsion grounds against a person can be disclosed. Or does the essence of the grounds need to be disclosed, even if contrary to the inter ests of state security? The Authority has argued that the principle of effective judicial protection requires that a per son expelled from an EEA State on grounds of public pol icy/public security must be informed of the essence of the grounds against him, even if the disclosure would be con trary to the interests of state security. Only in such circum stances can the legality of an exclusion decision be ade quately examined and challenged.
Case C-171/11 FRA.BO on whether a German private law standardisation entity is subject to the EU rules on free movement of goods and/or to the EU competition rules. Case C-202/11 Las Case C-226/11 Expedia on a French case whether the EU competition rules preclude national competition authorities from bringing proceedings and imposing penalties under national antitrust law when the practice at issue would fall under the Commission’s de minimis communication. Case C-239/11 P Siemens v Commission concerning an appeal in a cartel case on whether the EU antitrust fining procedure (Regulation EC No. 1/2003) is compatible with fundamental rights. Case C-300/11 ZZ Joined Cases T-289/11 and T-290/11 Deutsche Bahn v Commission on whether the lack of prior judicial authorisation of unannounced antitrust inspections by the Commission under Regulation EC No. 1/2003 is compatible with fundamental rights.
LEGAL AFFAIRS
ESA Day and public presentations After introducing the concept with success in Reykja vik the year before, ESA Day presentations were given in Vaduz, Oslo and once more in Reykjavik in 2011. The point of the ESA Day is to give government officials in the EFTA States a better understanding of the Author ity’s approach in different fields of its case han dling. In Reykjavik in June more than 100 offi cials attended the ESA Day, approximately 50 attended the ESA apéro in Vaduz in Septem ber and the attendance was 100 at the ESA mini seminar in Oslo in November. The Authority also continued to receive visitor groups in Brussels. More than 1,500 people attended public pres entations given by the Author ity throughout 2011. In addi tion, the Authority’s College, Directors and staff mem bers participated in a range of seminars in EFTA and EU Mem ber States.
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